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Southside Bancshares, Inc. (SBSI) — WACC Analysis

WACC Breakdown

Southside Bancshares, Inc. (SBSI) has a weighted average cost of capital (WACC) of 19.1%. The cost of equity is 8.2%, derived from a beta of 0.64 and a risk-free rate of 5.0%. The after-tax cost of debt is 69.3%. The capital structure is 82.2% equity and 17.8% debt.

Interpretation

A WACC of 19.1% indicates that the market perceives Southside Bancshares, Inc. as higher-risk, requiring a greater return to compensate investors.

Investors can compare SBSI's WACC of 19.1% against industry peers to gauge its relative financing costs. A beta of 0.64 reflects the stock's volatility relative to the broader market.

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VALUATION

SBSI WACC: 19.07% for Southside Bancshares, Inc.

Current inputs imply a 8.17% cost of equity and a 87.75% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

Southside Bancshares, Inc. Common Stock (SBSI) WACC Results
Weighted Average Cost of Capital
19.07%
Cost of Equity
8.17%
Risk-Free Rate4.96%
Beta0.64
Market Risk Premium4.23%
Cost of Debt
69.32%
Pre-Tax Cost of Debt87.75%
Tax Rate21.00%
Tax Shield18.43%
Capital Structure
Equity: 82.18%($958.92M)
Debt: 17.82%($207.87M)
Equity Component
6.72%
82.18% × 8.17%
Debt Component
12.35%
17.82% × 69.32%

Southside Bancshares, Inc. (SBSI) WACC in context

Southside Bancshares, Inc. (SBSI) currently screens with an estimated WACC of 19.07%. That blends a 8.17% cost of equity, a 87.75% pre-tax cost of debt, and a 82.18% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively high discount rate, which makes valuation more sensitive to execution and capital structure risk.

What SBSI WACC implies

A 19.07% discount rate screens as a relatively high discount rate, which makes valuation more sensitive to execution and capital structure risk.

How this page calculates SBSI

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.64 and equity accounts for 82.18% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.